Following its decision in Banner Health (despite the uncertainty caused by the Noel Canning decision), the National Labor Relations Board (NLRB) recently released an Advice Memorandum stating that Verso Paper Corporation’s written policy calling for employees to maintain confidentiality in all workplace investigations violates Section 7 “concerted activity” rights under the National Labor Relations Act (NLRA). Verso’s policy is unlawful, says the NLRB, “because it does not take into account the Employer’s burden to show in each particular situation that the Employer has a business justification for confidentiality that outweighs employees’ Section 7 rights.”
Banner Health: Blanket Confidentiality Violates NLRA Section 7
As reported in July 2012, the NLRB in Banner Health held that at the outset of each investigation employers must carefully balance whether a confidentiality requirement truly is warranted under the specific circumstances, or whether it would unfairly impinge employees Section 7 rights to discuss their working conditions. Only where a need for confidentiality outweighs Section 7 rights can confidentiality be required.
Unfortunately, the NLRB’s analysis in Banner Health at least implied that the only relevant factors weighing in favor of confidentiality are whether witnesses need protection, evidence is in danger of being destroyed, testimony is in danger of being fabricated, or there is a need to prevent a cover up. The NLRB provided no guidance as to whether or not any additional factors, or what other factors, might be important in justifying a confidentiality instruction. In particular, the NLRB in Banner Health did not discuss overarching factors which generally warrant confidentiality in most workplace investigations, including encouraging witness and complainant participation.
Verso Paper’s Unlawful Confidentiality Policy
Verso Paper’s policy articulated the broadly-accepted bases for investigation confidentiality:
Verso has a compelling interest in protecting the integrity of its investigations. In every investigation, Verso has a strong desire to protect witnesses from harassment, intimidation and retaliation, to keep evidence from being destroyed, to ensure that testimony is not fabricated, and to prevent a cover-up. To assist Verso in achieving these objectives, we must maintain the investigation and our role in it in strict confidence. If we do not maintain such confidentiality, we may be subject to disciplinary action up to and including immediate termination.
The NLRB’s Advice Memo suggests that Verso’s blanket policy is unlawful because “specific facts” revealing a “legitimate and substantial” reason are necessary to justify confidentiality in each case:
An employer may prohibit employees’ discussions during an investigation only if it demonstrates that it has a legitimate and substantial business justification that outweighs the Section 7 right. In Banner Health, the Board held that an employer must show more than a generalized concern with protecting the integrity of its investigations. Rather, an employer must “determine whether in any give[n] investigation witnesses need[ed] protection, evidence [was] in danger of being destroyed, testimony [was] in danger of being fabricated, and there [was] a need to prevent a cover up.”
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The Employer may not avoid this burden by asserting its need to protect the integrity of every investigation, but rather must establish this need in the context of a particular investigation that presents specific facts giving rise to a legitimate and substantial business justification for interference with the employees’ Section 7 right. (Emphasis added.)
It has also been reported that at least one EEOC office has taken the position that this type of blanket confidentiality policy violates Title VII’s right to oppose discrimination. This appears to be contrary to the EEOC’s prior Guidance which provides: “An employer should make clear to employees that it will protect the confidentiality of harassment allegations to the extent possible.” Naturally, an employer cannot hope to maintain confidentiality if employees are not requested, or have no obligation, to do likewise.
Significantly, the Advice Memo acknowledges that “the first two sentences of [Verso Paper’s] rule lawfully sets forth the Employee’s interest in protecting the integrity of its investigations.” (Emphasis added.) Given that the first two sentences of Verso Paper’s policy refers to its interests (not employees’), presumably the Advice Memo means the Employer’s interest, not the Employees’.
The Advice Memo also suggests language to replace the offending language in the last two sentences of Verso Paper’s policy:
Verso may decide in some circumstances that in order to achieve these objectives, we must maintain the investigation and our role in it in strict confidence. If Verso reasonably imposes such a requirement and we do not maintain such confidentiality, we may be subject to disciplinary action up to and including immediate termination.
This language provides little protection. An employer’s general policy of investigation confidentiality also supports an employer’s complaint procedures by encouraging timely, legitimate complaints and fosters its ability to fulfill the duty to promptly investigate and address EEO and other legal issues. It may come as a shock to complainants and other employees that confidentiality is no longer required in all investigations. And, the mere possibility of confidentiality may be little consolation to complainants and other employees genuinely concerned about confidentiality and reluctant to participate. But, that appears to be the protection the NLRB now sees fit to afford employees.
Employers’ Difficult Position
Even though the Advice Memo acknowledges an employer’s “compelling” interests and “strong desire to protect witnesses,” this rule still puts employers in the difficult position of having to develop “specific facts” warranting a “substantial” need for confidentiality before the investigation begins and before it can require employee confidentiality. At the outset of an investigation, however, it is not often clear in what direction a workplace investigation will lead; what might happen during (or after) an investigation to trigger confidentiality concerns or retaliation; or on what particular grounds confidentiality might truly be necessary in retrospect. That is at least in part exactly why a blanket approach to investigation confidentiality is important, necessary and has been the preferred practice.
While NLRB’s Advice Memo is not binding, and Banner Health could be invalidated depending on the outcome of the Noel Canning case, it strongly suggests that the NLRB intends to pursue this position, similar to its position regarding social media and Section 7 rights. Thus, you may want to think about taking a number of steps to make a confidentiality instruction more likely to pass NLRB muster, including:
- limit confidentiality instructions to EEO / legal issues or when investigation integrity is a particular concern;
- specifically consider and document why confidentiality is necessary to a particular investigation;
- ask complainants and witnesses to share and document concerns regarding confidentiality, intimidation, retaliation or other concerns that could warrant confidentiality;
- revise written policies to reflect the NLRB “approved” language;
- tailor confidentiality requirements to the specific subject matter of the investigation, and matters discussed in interviews and statements only during the investigation;
- limit the confidentiality instruction to interviewed employees who have personal knowledge of events or other directly relevant information;
- clarify that you cannot guarantee confidentiality;
- clarify that the confidentiality restriction is not intended generally to prevent employees from addressing concerns with one another or with the employer; and
- explain that the purpose of the confidentiality restriction is to:
- preserve the integrity of the investigation process;
- encourage employees to speak up when they have a problem and give them confidence that they may speak the truth;
- uphold your anti-retaliation policy; and
- allow you to conduct thorough and objective investigations which, in turn, allow you to effectively address employee complaints and concerns and resolve workplace conflict.
Chris Chrisbens is the lead attorney for Holland & Hart’s Affirmative Action Planning and Office of Federal Contract Compliance Programs (OFCCP) service. He can be reached at firstname.lastname@example.org or 303-295-8193.
Disclaimer: This article is designed to provide general information on pertinent legal topics. The statements made are provided for educational purposes only. They do not constitute legal advice and are not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.